Ex-Deutsche Bank Trader Accuses FCA of 'Shaming But Not Naming'

  • Christian Bittar suing FCA in London court on identification
  • Lawyers say FCA made allegations with no chance to respond

The U.K. Financial Conduct Authority has an approach of "shaming but not naming" traders in penalty notices against banks, denying them the opportunity to rebut allegations about their behavior, a lawyer for an ex-Deutsche Bank AG trader told a London court.

Christian Bittar, a former high-profile banker at the German lender, said the FCA failed to properly hide his identity in a multi-million pound settlement with Deutsche Bank over the Libor-rigging scandal. Lawyers for Bittar told a London judge Thursday the regulator had made "very severe and very detailed criticisms" of Bittar without giving him the chance to respond.

Deutsche Bank was fined a record $2.5 billion in April by global regulators for manipulating the London interbank offered rate and related interest-rate benchmarks. As part of the settlement the FCA published a document outlining the wrongdoing, including specific examples of misbehavior by traders and managers, using monikers such as manager A. The FCA is obliged to give a person the chance to respond to allegations before publication if they’re identifiable.

"You don’t have to be Morse or Sherlock" to work out who Bittar is in the Deutsche Bank notice, said Andrew Hunter, a lawyer for Bittar. The FCA goes into a "huge amount of detail in its effort to shame manager B," which is the term used to describe Bittar in the settlement.

‘Pejorative Suggestions’

FCA lawyer Paul Stanley said he wouldn’t "rise to the pejorative suggestions" that had been made about why the FCA decided to draft the notice the way it did. "We’re a million miles away" from any reasonable assumption a person would know manager B was Bittar just from looking at the FCA notice, he said.

Stanley said it was irrelevant that a person could look at other statements about Deutsche Bank published the same day as the FCA settlement and deduce who Bittar was from the various descriptions.

Bittar was Deutsche Bank’s most profitable derivatives trader, earning a bonus of as much as 90 million pounds in 2008. The FCA last year sent Bittar a warning notice, threatening a fine of 10 million pounds for allegedly trying to rig benchmark interest rates, a person with knowledge of the situation said in June 2014.

London Whale

The FCA is facing a host of similar claims after a London court ruled it improperly identified Achilles Macris, the former JPMorgan Chase & Co. manager of the London Whale, in a settlement notice. The FCA is trying to appeal that decision to the U.K. Supreme Court.

A hearing for former Barclays Plc currency trader Chris Ashton took place Wednesday relating to the FCA settlements over the foreign-exchange manipulation scandal. He said he was improperly identified in a Barclays currency settlement and is trying to add a second claim in relation to the UBS Group AG notice. While individuals have 28 days from the publication of a notice to make a claim and Ashton was almost sixth months late and is asking for the time barrier to be waived.

Before it's here, it's on the Bloomberg Terminal.